Bombay High Court
Merit Magnum Construction ... vs The State Of Maharashtra And 6 Ors on 22 November, 2022
Bench: G.S. Patel, Sharmila U. Deshmukh
Merit Magnum &Anr vs. State of Maharashtra & Ors.
903-oswp-565-2020.doc
sanjay_mandawgad
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO. 565 OF 2020
WITH
INTERIM APPLICATION NO. 2370 OF 2020
IN
WRIT PETITION NO. 565 OF 2020
WITH
INTERIM APPLICATION (L) NO. 31572 OF 2021
IN
WRIT PETITION NO. 565 OF 2020
1.
Merit Magnum Construction
(formerly known as Vimal
Builders)
A Registered Partnership Firm Having its
Office at Godrej Coliseum, A Wing, 1301,
13th Floor, Behind Everard Nagar, Off,
Eastern Express Highway, Sion East,
Mumbai-400 022.
2.
Nainesh K Shah,
Partner of Petitioner No.1 Having His
Office at Godrej Coliseum, A Wing, 1301,
13th Floor, Behind Everard Nagar, Off,
Eastern Express Highway, Sion East,
Mumbai-400 022. ...Petitioners
Digitally
signed by
SANJAY
SANJAY
ASARAM
ASARAM
MANDAWGAD
MANDAWGAD Date:
~ versus ~
2022.11.25
11:19:31
+0530
Page 1 of 16
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903-oswp-565-2020.doc
1. THE STATE OF MAHarashtra,
Through the Principal Secretary, Housing
Department Mantralaya, Mumbai 400 032
2. CHIEF EXECUTIVE OFFicer,
Slum Rehabilitation
Authority,
Having Office at Administration Bldg,
Anant Kanekar Marg, Bandra (E),
Mumbai 400 051
3. Municipal Corporation Of
Greater Mumbai,
Mahanagar Palika, Opp. CST, Mumbai
400 001.
4. Kalidas Kolambakar,
4, G.D. Ambekar Marg, Police Colony,
Sathe Nagar, Mumbai 400 014.
5. Wadala Village Welfare Co-
Operative Housing Society,
Nalanda Institute (Balwadi), Wadala,
Sewri X-Road, Wadala, Mumbai 400 031.
6. Nayab Tehshildar,
SRA having Office at Fifth Floor,
Administrative Bldg. Anant Kanekar
Marg, Bandra (E), Mumbai 400 051.
7. Deputy Collector,
SRA having Office at Fifth Floor,
Administrative Bldg. Anant Kanekar
Marg, Bandra (E), Mumbai 400 051.
8. Apex Redressal Grievance
Committee,
A Committee Established by Government
of Maharashtra Having his Office at First
Floor, Administrative Building, Anant
Page 2 of 16
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Kanekar Marg, Bandra (East), Mumbai
400 051. ...Respondents
A PPEARANCES
for the petitioners Mr Aspi Chinoy, Senior Advocate
with Dr Birendra Saraf,
Senior Advocate, with Hrushi
Narvekar, Samit Shukla,
Aneesa Cheema, Siddharth
Shah, Anish Shahapurkar i/b
DSK Legal.
for respondent no. 1 Mr Amit Shastri, AGP.
state
for respondents Mr Vijay D Patil.
nos.2, 6 and 7 (sra)
for respondent no.3 Mr Sagar Patil.
mcgm
for respondent no.4 Mr SB Pawar, with Swati Sawant
i/by SK Legal Associates LLP.
for respondent no.5 Mr Parth Jain, i/by Jain Law
Partners.
for respondent no.8 Mr Jagdish G Ardawad (Reddy).
(agrc)
for intervenor and Mr Subhash Bane.
applicant in
ia(l)/31572/2021
CORAM : G.S.Patel &
Sharmila U.
Deshmukh, JJ.
DATED : 22nd November 2022
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903-oswp-565-2020.doc
ORAL JUDGMENT (Per GS Patel J):-
1. Rule. The appearing Respondents waive service.
2. The matter has a long history. Present before us today are the
present developers of a large project that issome sort of a hybrid,
perhaps neither fish nor fowl , and possibly defying description or
easy slotting into any particular statute. This will become apparent.
As a result, there are multiple Regulatory Authorities all involved
simultaneously. The developers are of course here in pursuit of their
commercial interest. But one of the other concerns, and perhaps the
one that we must, we believe, keep at the forefront is the interest of
those who are sought to be rehabilitated and are yet to be
rehabilitated or rehoused in this project, whatever be the description
available that is applied to them. There is a society called Wadala
Village Welfare CHSL before us. One of its office bearers and a
member have been present in Court since yesterday. We have
ourselves explained in Marathi, a language with which they are
comfortable, what precisely is the ambit of the challenge, what our
concerns are and what might possibly be the consequences of a
needless opposition on their side at this stage. We have been at some
pains to point out to them that an opposition will only result in a
further delay especially in the delivery of their long - promised -
homes. They propose to appoint a new advocate, which we note. We
are not examining the reasons why the society or some of its office
bearers or members feel that a change in legal representation is
necessary except to say only that we do not believe that their
apprehensions are even slightly justified.
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3. To understand the present controversy and the challenge as it
presently exists to an order of the Slum Rehabilitation Authority at
Exh.1 at page No.131 passed on 18th November 2019, some
background will be required. First, we extract the operative portion
of the impugned order from page Nos. 151 to 152:
"(i) The Application of applicant society i.e. Wadala
Village Welfare CHS Ltd. dated 15.02.2019 for termination
of Respondent No.1 i.e. M/s. Merit Magnum Construction
(Erstwhile Developer M/s. Vimal Builders) is hereby
allowed. The said Developer stands terminated.
(ii) The Applicant society is at liberty to appoint new
Developer of their choice in the presence of Joint Registrar
C.S. /SRA in accordance with rules, regulations and policy
of SRA for implementation of SR Scheme within a period
of 90 days from the date of order.
(iii) The Engineering Department of SRA to appoint
Government Approved Valuer to value the expenses legally
incurred by the Respondent No.1 Developer on site, within
a period of two months from this order and inform the same
to the Applicant Society.
(iv) The newly appointed Developer should reimburse
the actual expenses legally incurred by the Respondent No.1
Developer for implementation of subject S.R.Scheme till
date of his termination."
4. This has to be read in the context of Section 13(2) of the
Maharashtra Slum Areas (Improvement, Clearance and
Redevelopment) Act, 1971 as that amended section applies to Slum
Rehabilitation Schemes. Section 13 in its entirety reads thus:
"13. Power of Slum Rehabilitation Authority to develop
Slum Rehabilitation Area.
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(1) Notwithstanding anything contained in sub-section
(10) of section 12, the Slum Rehabilitation Authority may,
after any area is declared as a Slum Rehabilitation Area, if
the landholders or occupants of such area do not come
forward within a reasonable time, with a scheme for re-
development of such land, by order, determine to re-
develop such land by entrusting it to any agency for the
purpose.
(2) Where on declaration of any land as Slum
Rehabilitation Area, the Chief Executive Officer is satisfied
that, the land in the Slum Rehabilitation Area has been or is
being developed by the owners, landholders or occupants or
developers in contravention of the plans duly approved, or
any restrictions or conditions imposed under sub-section
(10) of section 12, or in contravention of any provision of
any Slum Rehabilitation Scheme or any condition specified
in the approval or, has not been developed within the time,
as specified under such conditions of approval, he may, by
order, determine to develop the land declared as Slum
Rehabilitation Ara by entrusting it to any agency or the
other developer recognized by him for the purpose."
5. The project is vast. In its entirety, it covers some 41,950 sq
mts at Dadar, Naigaon, Sewri and Wadala. That land is owned by
MCGM. It has certain contiguous plots. One of these, plot No.10 is
a plot of 24,907.97 sq mts. Plot No. 10 includes slums on existing
road No.21 that abuts plot No.10.
6. The slum-dwellers formed the Wadala Village Welfare CHSL.
That society resolved to rehabilitate the slum-dwellers with a slum
redevelopment proposal under Development Control Regulation
33(10) of the DC Regulations, 1991.
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7. An SRA scheme on plot No.10 came to be sanctioned. The
relevant records show 1,158 eligible slum-dwellers and 965 slum-
dwellers on contiguous plots. There were also 44 Vacant Land
Tenure ("VLT") occupants and 60 Municipal Tenants. But none of
these were in any contiguous plots or areas. . They were scattered
all over.
8. On 1st February 2006, a Letter of Intent ("LoI") was issued
to developer Merit Magnum Construction. Four years later, on 12th
April 2010 there came to be issued a revised LoI since there was a
change in the area of the rehabilitation tenements required to be
provided. The area was increased from 225 sq ft per eligible person
to269 sq ft. A specific clause 18 of the revised LoI required Merit
Magnum to have the eligibility of the four VLTs and 60 Municipal
Tenants decided by the Assistant Commissioner, Estates . A revised
Annexure-II, a statutory document that lists persons eligible for
rehabilitation under a slum scheme, had to be prepared.
9. By 2010, Merit Magnum had constructed three rehabilitation
buildings. It had the necessary permissions for 11 more
rehabilitation buildings. But these were being impeded by the
continuance of the dispersed VLTs and Municipal Tenants. Merit
Magnum asked the MCGM to take immediate steps for their
eviction or removal.
10. On 19th November 2011, in response to a complaint by the
Society that there was a delay on the part of the Merit Magnum,
Merit Magnum pointed out that it could not progress so long as the
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VLTs and Municipal Tenants continued on site. The MCGM was
also contending that there was a policy change. An application by
some of the Respondents to remove Merit Magnum failed.
11. Four years went by. In November 2015, Merit Magnum filed
Writ Petition (L) No.3335 of 2015 for a direction to the MCGM to
take immediate steps for the removal of the four VLTs and 60
Municipal Tenants.
12. In this writ petition, SRA filed an affidavit of 4th February
2016. The details of the affidavit are perhaps unimportant today.
What matters is that on 7th April 2006, a Division Bench of this
Court passed an order in Merit Magnum's Writ Petition (L)
No.3335 of 2015. This gave the mcgm MCGM six weeks to
scrutinise and verify the documents relating to the 60 Municipal
Tenants and four VLTs. There was also a direction to the MCGM to
take steps for the removal of these persons within four weeks after
the scrutiny and verification was completed. An Special Leave
Petition against this order failed on 22nd July 2016.
13. Despite this order, MCGM took no steps to vacate the VLTs
and the Municipal Tenants. Instead, it now required Merit Magnum
to file a fresh proposal for a composite or hybrid redevelopment
project under DCR 33(10) (slum redevelopment and rehabilitation)
read with DCR 33(7) (cessed building redevelopment) saying that
the 60 Municipal Tenants and four VLTs were all in cessed
structures. MCGM demanded a significant amount from the
Petitioners as a capitalized value.
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14. Merit Magnum filed a fresh Writ Petition (L) No.136 of 2017
challenging this new demand by the February.
15. On 1Februaryuary 2019, there was a complaint to the SRA to
take action under Section 13(2). Merit Magnum pointed out that the
entire position on ground was unchanged. The 60 Municipal
Tenants and four VLTs were still on site. The whole scheme was
held up. That is why Merit Magnum had filed a second Writ
Petition. The delay, Merit Magnum asserted, was attributable to
MCGM. The response by the SRA at that time through its CEO
was a direction to maintain the status quo. Despite this, notice
seems to have been issued on 22nd April 2019 under Section 13(2)
intimating a hearing.
16. Back came Merit Magnum to the High Court on 30th April
2019 in Writ Petition No.565 of 2019 impugning this notice under
Section 13(2). On this, an important order was passed on 30th April
2019 by the Division Bench which directed that even if an order was
passed on the impugned Section 13(2), no effect would be given to
that order without leave of the Court.
17. The matter under section 13(2) seems to have proceeded.
Merit Magnum filed written submissions. It presented its
arguments. It set out the chronology and the situation at site.
Ultimately, there was an order passed under Section 13(2) on 18th
November 2019. The operative portion has been set out above. In
view of the High Court order dated 30th April 2019 that order was
not given effect to. SRA never sought leave to implement that order.
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18. On 7th February 2020, Merit Magnum went in Appeal to the
Apex Grievance Redressal Committee. The AGRC held that in view
of the High Court order dated 30th April 2019 Merit Magnum's
appeal challenging the Section 13(2) order could not be entertained.
Not that it matters, but we believe that AGRC materially
misdirected itself in holding as it did. The appeal before it was on
merits. Like the order under Section 13(2), any order in appeal
before the AGRC would have been subjected to the same restraint.
But this could not and did not mean that the AGRC could not
entertain the appeal or that the appeal was not maintainable. By now
far too much time has already been spent, for no fruitful purpose, in
going back and forth between these authorities and we do not
propose to remand the matter.
19. We come now to an order of 1st December 2021. This was by
Division Bench of which one of us (GS Patel,J) was a member. The
order disposed of Writ Petition No. 136 of 2017 along with Interim
Applications in that Writ Petition by the Society, and Writ Petition
No.565 of 2020 with Interim Applications in that Writ Petition.
20. The Division Bench dealt with the arguments by the MCGM
regarding capitalised value. It inter alia held that after the High
Court order of 4th April 2016, there was no question of the MCGM
refusing to vacate the 60 Municipal Tenants and four VLTs.
MCGM's argument that it would be entitled to payment of
capitalised value was in terms rejected.
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21. This order of 1st December 2021 was taken up in a Review
Petition dated 21st December 2021 filed by some Municipal
Tenants. That was dismissed. Special Leave Petitions filed by
Municipal Tenants and by the Society failed in January and
February 2022.
22. In the meantime, by the order of 1st December 2021 itself,
Merit Magnum was allowed to amend Writ Petition No.565 of 2020
to now challenge the Section 13(2) order of 18th November 2019.
23. The 18th April 2019 Section 13(2) order by the SRA is more
or less frozen. Effect cannot be given to that order without leave of
the Court. SRA has never sought leave of the Court. That is where
that matter rests.
24. In the meantime, MCGM has an ongoing obligation to
remove the Municipal Tenants and VLTs. We are informed that of
the 64 aggregate only four have been removed so far.
25. The third circumstance is that while there is now no
impediment to obtaining further permissions, SRA seems to be of
the view that it cannot grant any further permissions because it has
passed an order under Section 13(2) although that order has been
rendered ineffective without leave of that Court and no leave has
been sought.
26. This is a wholly untenable state of affairs. Between the
MCGM and its refusal to remove the Municipal Tenants and VLTs,
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its demands for capitalised value, a merger of two different schemes
in one hybrid and the SRA passing orders that it cannot give effect
to without leave of the Court (which it never seeks), and its
subsequent refusal to grant further permissions, the real victims are
those entitled to rehabilitation. We re-emphasize that our primary
concern is not and cannot be the developer though there is
undoubtedly a very real price that is being paid for no good reasons.
Mr. Chinoy states that 150 persons are on transit rent. Others are in
transit buildings and still others are yet to be vacated. The 150
persons who are in transit accommodation are being paid transit
rent of Rs.15,000/- p.m. It will not be long before they ask for an
increase in the above. If the project is delayed by these two
authorities, both Planning Authorities within the meaning of the
Maharashtra Regional and Town Planning Act, 1966, we do not see
how this project will ever be completed, or how the persons entitled
to rehabilitation will ever set foot inside their homes. Our
understanding was that Planning Authorities under the MRTP Act
are to facilitate planning, development, and the completion of
sanctioned projects. Our experience in this case seems to indicate
exactly the reverse: that everything possible is being done to see to it
that project does not ever get completed. We are forced to ask at
whose cost comes all this ? It seems to us starkly evident who the
real sufferers are. They are before us, represented by office bearers
of the society. We have explained to them and they have confirmed
to us personally that their only anxiety is to ensure that their homes
getbuilt and that they get their long-promised new homes.
27. We make this plain now. We propose to do our best to achieve
that singular purpose. It makes no difference to us who the
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developer of the moment may be. These persons eligible for
rehabilitation, all residents of the city, cannot be condemned for all
eternity to exist like this. It shocks our conscience that the two
planning authorities are entirely blind to the pitiable condition of
those entitled to rehabilitation. We cannot understand how they fail
to see that their actions are detrimental to the rights of those eligible
for rehabilitation.
28. We turn first to the impugned order of 18th November 2019.
The power under Section 13(2) is to be exercised in defined
circumstances. Where the Competent Authorities are satisfied that
the land has been or is being redeveloped by owner in contravention
of approved plans or in violation of restrictions or conditions
imposed under Section 12(10) or has not been redeveloped within time
if any specified, it may determine to redevelop the land at its own
cost. On a plain reading, the Section 13(2) order is only on the basis
that the redevelopment has not taken place 'within a reasonable
time'. That is its vulnerability. For the order completely overlooks
this history of the matter and also the repeated representations
made by the developer that unless the 60 Municipal Tenants and
VLTs are cleared, it cannot proceed further. The SRA has known of
the problems presented by the continuance of the 60 Municipal
Tenants and four VLTs on site. It has been a party to every
litigation. The SRA knows of the MCGM demands for capitalized
value. The SRA knows of the various orders of this Court. The SRA
is aware that all the Municipal Tenants and VLTs have not been
evicted. Yet the SRA seems to expect that none of this matters, and
that, despite these self-evident obstacles the project must be
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completed. We asked Mr Patil for the SRA only this question: how?
We received no answer.
29. The impugned order thus ignores the only vital and germane
criteria, i.e., the delay in the project that is caused by factors beyond
the Petitioner's control. It overlooks that three rehabilitation
buildings were completed and as long ago as 2010, 12 years ago; at
the time when the developers said they were ready with permission
to construct 11 more rehabilitation buildings. The impugned order
ignores all these materials. It does not address the consequences of
this long and tortured litigation history of which it was aware. We
wonder how it could be said by the SRA that the MCGM's inaction
in clearing the site of the Municipal Tenants and VLTs has had no
impact on the delay. Whether one looks at this from the perspective
of the decision-making process or from any other perspective, the
order under Section 13(2) of 18th November 2019 cannot be
sustained. It is quashed and set aside.
30. Rule is made partly absolute to that extent.
31. In view of this, there is no question of the SRA seeking leave
of the Court to give effect to Section 13(2) order since we have
quashed that very order. There is no question of the SRA declining
to grant further permission or refusing to process further
applications on the basis of that the 30th April 2019 order is still
operative in regard to a Section 13(2) order. The order of 30th April
2019 has now worked itself out as a result of our order today.
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32. This necessarily means that the SRA must now begin to
process all applications made to it by the developer for this project
and must do so in accordance with the applicable Act, Rules, Norms
and Policy and must do so within a reasonable time.
33. We have set out this history at some length, apart from
anything else, to give an indication of who according to us are the
persons most adversely affected by these continuous delays and the
amount of time and energy being expended in one litigation after
another. We do not want any more Writ Petitions.
34. For this reason, we are not disposing of this Writ Petition. We
propose to monitor this project to ensure that the project is
completed in a time bound manner without any further impediment.
We direct that without leave of this Court, and until the next date,
the appointment of Merit Magnum as a Developer shall not be
cancelled without prior leave of the Court. All applications seeking
any relief in respect of the subject project shall be filed in this Court
by way of Interim Applications in the present Writ Petition.
35. Apart from making rule partly absolute as stated above, we
issue the following additional directions. By 9th January 2023:
(a) MCGM will submit an action plan setting out the time
frame within which and the manner in which the
remaining VLTs and MTs will be evicted from the
project site.
(b) Merit Magnum will file an Affidavit of one of its active
partners setting out a bar chart indicating the project
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milestones, i.e., various phases of the construction of
the rehab component, and the timelines within which
these project milestones will be achieved.
(c) Merit Magnum will also set out in the Affidavit the
various permissions, approvals and renewals which will
be further required from SRA or MCGM or both for
the completion of the rehab component.
(d) SRA will appoint an officer of SRA as a Nodal Officer
who will be charged with the responsibility of
overseeing the project and will coordinate between the
Developer, the Society and SRA to ensure the smooth
completion of the rehab component of the project.
The Nodal Officer will file quarterly reports in this
Court setting out the progress.
(e) The matter will be listed periodically for monitoring
and supervision until the final occupancy certificate for
the last of the rehabilitation building is obtained.
36. No party is to move the vacation court in December 2022
under any circumstances.
37. List the matter high on board on 10th January 2023 for
directions.
(Sharmila U. Deshmukh, J) (G. S. Patel, J)
22nd November 2022
